AJG posts strong results in Q1 driven by acquisitions
Broker Arthur J Gallagher (AJG) posted a strong set of results for the first quarter of 2015, driven largely by its acquisition of 11 companies.
Its combined brokerage and risk management segments posted 30 percent growth in adjusted revenues to $927.4 million in the first quarter of 2015, including 6 percent organic growth, compared with $728.6 million in the first quarter of 2014.
AJG’s brokerage segment posted an increase in adjusted revenues of 36 percent, of which 4.5 percent was organic growth. The broker said that during the first quarter of 2015, it completed 11 acquisitions with annualised revenues of nearly $34 million. Its risk management segment posted an organic revenue increase of 10.9 percent.
Under the accountancy term EBITDAC, which Gallagher defines as net earnings before interest, income taxes, depreciation, amortization and the change in estimated acquisition earn-out payables, the broker made $196.7 million in the first quarter of 2015, an increase of 46 percent compared with $134.5 million in the first quarter of 2014.
“We are off to an excellent start in 2015,” said J Patrick Gallagher, chairman, president and chief executive officer (CEO). “Our revenue momentum continues. In the first quarter, our combined brokerage and risk management segments posted 30 percent growth in adjusted revenues, of which 6 percent was total organic growth.
“We remain comfortable with the current rate environment and believe it is rational. We are seeing insurance carriers continuing to focus on profitable underwriting, quoting appropriate prices on a line-by-line basis, which allows us to demonstrate our expertise and high-quality value-added service. In addition, we are seeing our clients slowly expand their businesses and payrolls. Our global team is energised and well positioned for 2015.”
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